GoTo said on Monday in its first earnings results since going public last month that it recorded a IDR 21.4 trillion (USD 1.47 billion) net loss in 2021, with red ink flowing on into the first quarter of this year.
GoTo was formed in May of 2021 by the merger of ride-hailing and food delivery company Gojek and local e-commerce major Tokopedia. The pair were the two most prominent unicorns—or private companies worth USD 1 billion or more—in Indonesia.
The merged entity’s share price rose on its closely watched first day of trading on the Indonesia Stock Exchange on April 11, but has since lost momentum. Analysts have said that dealing with increasing competition, integrating the merged operations and achieving profitability are proving serious challenges for the company.
In a news release announcing the results, GoTo provided comparative figures for 2020 based on the premise that the companies had merged at the beginning of 2019. Those indicated a net loss of IDR 14.2 trillion for 2020.
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For the first three months of this year, GoTo said it posted a net loss of IDR 6.5 trillion—worse than an assumed IDR 1.8 trillion loss in the same period of 2021.
Net revenue for 2021 came in at IDR 4.5 trillion, which reflected a 36% increase from an assumed 2020 figure. In the first quarter, the figure showed an assumed 60% increase to IDR 1.5 trillion from the same period in the year before.
Despite the losses, Jacky Lo, GoTo Group’s chief financial officer, said that the company is “pleased with the solid growth momentum we achieved in 2021 despite headwinds caused by the COVID surge.”
Lo based his optimism on year-on-year growth of 40% in gross transaction value and 44% in gross revenue in 2021 compared with the assumed figures for 2020. Results for those metrics in the first quarter showed gains of 46% and 53%, respectively. The increases are “a promising indication for our future prospects,” Lo said.
“Moving forward, we will continue to take a robust and thorough approach to cost management, supporting our growth and investment objectives and allowing us to establish a clear path to profitability and drive further value for our various stakeholders,” Lo said.
GoTo shares closed up 0.64% on Monday at IDR 314 before the earnings announcement, but the stock is trading below its initial public offering price of IDR 338. The company’s market capitalization stood at IDR 371.9 trillion at Monday’s closing share price.
Hans Kwee, director at securities company Anugerah Sentra Investama, suggested that venture capital investors are unlikely to be pleased with the results.
“GoTo must quickly turn its position around to become profitable as it will face prolonged hardship in raising funds,” he told Nikkei Asia after the results came out. “It’s likely that VCs no longer consider GoTo for their portfolios as [the company] still has a strategy of burning money.”
This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.